Centers of Excellence: Purpose, Benefits, and Strategic Value

A Center of Manufacturing Excellence, or CoE, is a centralised place where best practices are formulated based on knowledge and data from a company’s experience. These practices eventually reside in its culture, so that companies can set standards for the organisation and implement them consistently across all plants and areas.

It is an environment for testing new emerging processes and a tool for discovering, monitoring and disseminating manufacturing improvements.

As global competition continues to increase, industries are becoming increasingly competitive and production control needs to implement these improvement centers in order to lay a solid foundation and a sophisticated manufacturing system.

Objectives of the centers of excellence

A Centre of Excellence (CoE) is a vital component of any organisation wishing to achieve a digital transformation in its business.

Objective: to create operational initiatives aimed at increasing productivity, reducing costs and improving the quality of production.

Goals: to achieve increased and expanded production, achieving economies of scale and reduced response time, to generate additional workflows and lower production costs.

Benefits of having a center of excellence

• The correct allocation of resources and the prioritisation of projects according to their added value have a very positive financial impact. It saves time, increases responsiveness, agility and therefore reduces delivery times, improving the speed to market and the final customer experience.
• This center acts as a link between the individual parts of the business and develops measurements for each location, providing governance and communication between them. Companies achieve significant improvement in communication, empathy and data democratisation, thus synchronising supply chains.
• CoE centralises information; all project participants can easily access any information they need and contribute new ideas regardless of their department or geographical location. With CoE, companies become more collaborative and are prepared to benefit from global data and cohesion between areas.
• To make operations flexible and production capable of responding proactively to change, centers of excellence are responsible for creating standard processes that, along with automation, allow for essential variations and mass customisations. These types of control centers are in charge of preventing problems and generating reports that help in strategic decision making, in order to make the company evolve and strengthen.
• Centers of excellence present an opportunity to consolidate best practices and new technologies in one place central to production, certifying efficient processes and spreading them where they make sense. The result is an improvement in the product and service, allowing to achieve consistency in manufacturing and establish significant KPI standards for the quality of the result.
• These centers restructure resources and operating costs by eliminating inefficient practices and reducing the time to implement new skills and technologies. They promote intelligent automation and measurement because they are committed to investing in new technologies for digitising and exploiting data. By having a defined ROI, they can measure and test organisational impact very effectively.

How to ensure your success?

When it comes to COE, there doesn’t seem to be a standard model. It has a complex implementation process that integrates a set of best practices and working standards. It is a combination of people, processes, and technology that affects almost every activity in a global manufacturing process.

To ensure its success, although it depends largely on each organisation, there are some points to follow:

• Ongoing employee training: provide direct and indirect guidance and support to help plants implement these working standards. If the ultimate goal is digital transformation, guide and train employees to take advantage of new tools and exploit the value of new technologies.
• Well-defined objectives: as a basis, there must be a specific goal that pursues measurable, achievable and precise objectives. The CoE’s vision must always be aligned with its overall business strategy.  The vision of the center must coincide with the vision you have for the business.
• Internalise the predisposition to change: it is a question of culture and it will only happen if the talents are united and a global system of communication is created so that the relationship between the parties flows.
• Create a budget plan: include estimates on staff salaries and operating expenses. Poorly designed CoEs can end up costing the company more money than they bring in benefits, so it is important to pay attention to the financing structure of the center. There is no reason why CoEs should not operate with other businesses. For example, the CoE could be established as a joint venture between two or more companies.

New level of manufacturing competitiveness

The development and implementation of new technologies and the elimination of costs are the objectives of these centers, which are essential for manufacturing competitiveness.  Their main function is not to diagnose problems but to help identify and execute the short list of improvements that will really generate value.

The creation of a Center of Excellence is designed to benefit all stakeholders; employees, customers and shareholders. Processes almost always support a mission-critical function or business requirement, so they must be internalised and supported by a solid action plan.

Digital Transformation with Nexus Integra

If your company is looking for a digital transformation that takes competitiveness and production automation to a new level of efficiency, we recommend our integrated operations platform Nexus Integra.

Nexus Integra is a tool with a web access interface that enables the digital transformation of industries, centralising all the information with the maximum security and protection of your data. We adapt to your company so that exploiting your data is a judicious and valuable process.

Access the information of a specific installation or create dashboards to know the status of all your plants instantly and from anywhere. Scale your solutions with minimum effort and maximum efficiency and speed. All this is possible due to its powerful three-layer structure: Nexus Connect, Nexus Core and Nexus Apps.

If you want to know more, please contact us.